Tier 1 (Investor) Visas – A Quick And Uncomplicated Entry Route For Those Wishing To Invest In The United Kingdom

Despite new rules coming into force on the 6th November 2014, an investor visa remains the simplest, most efficient way for high net worth individuals and their families to obtain entry into the United Kingdom.

With one of the world’s best education systems, prestigious homes, a stable, corruption free government, and a secure financial and judicial system, the United Kingdom, and in particular, London, has long been a favourite destination for Russian, Chinese and Middle Eastern individuals, keen to invest their wealth in a well-regulated financial market.

This article details the advantages of a Tier 1 (Investor) Visa, the requirements for obtaining this visa both before and after the 6th November 2014, and the process of applying for indefinite leave to remain in the United Kingdom and British citizenship.

Advantages of a Tier 1 (Investor) Visa

The main advantage of an investor visa is that apart from having the required funds to invest, there are very few other conditions attached. For example, there is no requirement to be competent in the English language, the applicant is not required to have guaranteed employment (although you may work if you wish) and your partner and/or children under 18 years will be welcomed into the country along with you.

To add to the flexibility of this type of visa, recent changes made to the Immigration Rules set out in the Statement of Changes in Immigration Rules, HC 693, mean that investors granted a visa on or after the 6th November 2014 will not be required to top up their funds if the market value of the capital falls below the required investment levels. However, if the qualifying investments are sold causing the total purchase price of the remaining investments to fall below the qualifying figure, then new investments will be required to be purchased to make up the lost value within the same financial reporting period.

This change in policy is seen as a welcome development within the financial sector as it frees up foreign investors to take more risks with their investment portfolios, without have to worry about ‘topping up’ their losses if the returns are lower than anticipated.

The Basic Requirements for Obtaining an Investor Visa

To be eligible for a Tier 1 (Investor) Visa you will need to meet the following requirements if you apply on or after the 6th November 2014:

A minimum of £2 million available for investment

Be over 16 years of age

You must invest the full £2 million in qualifying investments (for example UK-government bonds, share capital or loan capital in active and trading UK-registered companies other than those principally engaged in property investment, management or development)

The investment sum must not be sourced from a loan

If you applied for an investor visa before the 6th November 2014 the old eligibility rules apply. These are as follows:

The applicant must have a minimum of £1 million to invest

The applicant may borrow the entire £1 million from a UK regulated financial institution

At least 75% of the funds must be invested in qualifying investments (for example UK-government bonds, share capital or loan capital in active and trading UK-registered companies) and up to 25% may be invested in assets such as personal property.

Making an Application

In order to be granted permission to stay in the United Kingdom under the Tier 1 (Investor) route your solicitor will need to submit an application for entry clearance. If successful, you will be entitled to remain in the United Kingdom for a period of three years and four months, with an option to extend the visa for a further two years. You may also apply for indefinite leave to remain and British citizenship.

Important

When applying to extend your visa you will need to show, via a portfolio report from a UK regulated financial institution, that you invested the full £2 million (if you were granted your visa after the 6th November 2014) within three months of your ‘investor start date’. The investor start date is defined as:

the date you came into the UK (if you have proof of this)

the date your original visa application or switch from a different visa category was approved (if you can’t prove your date of entry)

If your investor visa was granted before the 6th November 2014 the report will need to show you invested at least £750,000 and maintained that level of investment throughout the duration of the visa.

You may apply for an investor visa up to three months before you wish to enter the United Kingdom.

Entry Clearance

You can apply for entry clearance at the British High Commission or Consulate in your country of nationality or the one you usually reside in. It is important to note that while your application is being processed the embassy or consulate will have your passport in their possession. If you travel frequently for business, ensure that your legal advisor gives you a realistic expectation on the time it will take to gain entry clearance in the country where you make your application. Some territories do offer a premium service to hasten the process along.

Entry clearance can be refused if an individual has previously been deported from the United Kingdom, has a criminal conviction or has been refused entry on a prior application.

Important

It is vital that all supporting documents required for your application meet the standards set out in the Immigration Rules and the Policy Guidance, to ensure that the application process runs smoothly and efficiently. Supporting documents will include evidence of the funds you are investing, where they came from, how and where you will be investing them etc. Your legal professional should be extremely familiar with the requirements set needed to submit these supporting documents and check a scanned (translated) version of each before the originals are submitted to avoid unnecessary delays.

Indefinite Leave to Remain

If you have invested £2 million you may apply for indefinite leave to remain in the United Kingdom after five years. The length of time required to make an application for indefinite leave to remain reduces with the more money you invest within the country. If you have invested £5 million you may apply for indefinite leave to remain after three years, if you invest £10 million you may apply after two years in residence. Although it is accepted that high net worth individuals travel frequently, you cannot be outside the United Kingdom for more than 180 days over a twelve month period in order to apply for indefinite leave to remain.

Naturalisation

To become a British citizen you must have lived in the United Kingdom for at least five years and have been granted indefinite leave to remain. If you wish to apply for citizenship you will be required to have a good knowledge of the English language and take the Life in the UK test.

Important

If you wish to apply for British citizenship, you may not have spent more than 450 days outside the United Kingdom during the five year qualifying period and during the final 12 months you must not spend more than 90 days outside the country. It is important to bear this factor in mind at the start of your application if your final goal is naturalisation.

Dependants

You are entitled to bring your immediate family (ie wife, husband, partner and children under 18 years) into the United Kingdom with you if you are granted an Tier 1 (Investor) Visa. Your family members will also be able to apply for indefinite leave to remain and naturalisation.

If you have a child over the age of 18 years they must apply for settlement in his or her own right, unless there are exceptional circumstances. This can be done by applying for a student visa (if planning to study) or a work permit.

Tax Implications

Changing countries of residence or obtaining dual citizenship can have a substantial effect on your tax obligations, both in the United Kingdom and off-shore for both you and your family. It is essential that you obtain advice on how to organise your affairs with regards to tax planning in the early stages of your application.

For high net worth individuals, investor visas provide a fast, uncomplicated entry into the United Kingdom and a smooth path towards naturalisation if your goal is to become a British Citizen. To find out more click here.

We welcome any comments from our readers; please feel free to write your thoughts in the comments section below.

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